Baroness Miller of Hendon: I thank the noble and learned Lord for his explanation. I shall read it very carefully. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 48 agreed to.

Clause 49 agreed to.

Baroness Miller of Hendon moved Amendment No. 124:

After Clause 49, insert the following new clause--

Financial Statement and Budget Report

(" . The Chancellor of the Exchequer, acting in consultation with the Secretary of State, shall include in the Financial Statement and Budget Report an assessment of the cost of the national minimum wage to Her Majesty's Government in respect of employment costs in the public sector.").

The noble Baroness said: I made clear to the noble Lord, Lord Haskel, that in moving Amendment No. 124 I would also speak to Amendment No. 125.

"Unnecessary secrecy in Government leads to arrogance in governance and defective decision making".

Those are not my words, but the opening sentence of the Government's recent White Paper Your Right to Know: Freedom of Information.

"The traditional culture of secrecy will only be broken down by giving the people of the United Kingdom a legal right to know".

Those are not my words, but those of the Prime Minister in his personal introduction to the White Paper.

In the spirit of those fine sounding words, Amendment No. 125 is a simple but democratically important addition to the Bill. It anticipates the legislation that the Government say they intend to introduce. It can be summarised in a few, short sentences. Subsection (1) requires the Secretary of State and the Chancellor of the Exchequer to lay an annual report before Parliament as to the workings and the effects of the national minimum wage. Subsection (2) entitles the Low Pay Commission to make a similar report to the Secretary of State. If it chooses to do so, she in turn must lay that report before Parliament unless its report is already covered by her own annual report. Subsection (3) sets out nine headings under which the Secretary of State and the Chancellor are required to report. The Low Pay Commission may report on all or

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any of those headings as it thinks fit. Subsection (4) makes it clear that the reports can contain any other material thought to be relevant.

The purpose of the amendment is purely in the interests of open government--a cause which the present Administration wish to espouse. It ensures that the Secretary of State keeps Parliament fully informed of those consequences--good or bad. It is information that Parliament is entitled to have--good or bad.

The Government claim that the Bill will have no adverse effect on employment; no adverse effect on industry; no adverse effect on exports; and no adverse effects on the economy generally. If their confidence is not misplaced, then no doubt they will want to trumpet to the entire population the benefits that they have secured for it.

If our predictions, unhappily, prove to be correct--and it will give us no satisfaction if they are, because of the detrimental effects--then it is only right that the Government should come to Parliament and admit their errors and say what they are going to do about them.

Apart from the fact that there is absolutely no reason why the Government should not supply the information, this is definitely one amendment that the Government cannot arbitrarily reject, as they have so many others.

The arguments for the new clause proposed in Amendment No. 124 are precisely the same as those I have just mentioned. Indeed, at one time I contemplated putting both clauses together, but I was advised that there might be different implications between the two.

Again in the interests of open government, there should be no objection to the Chancellor telling Parliament at the appropriate time of the year how much it is costing the public, both as taxpayers and as council tax payers, to implement the Government's policy. I shall be glad to discuss any constructive modifications which the Minister may wish to suggest about specific aspects of the new clauses.

Subject to that, if the Government say they are unable to agree to this very reasonable request in the interests of open government, then the information we want them to make public may have to be extracted from them rather in the manner of pulling teeth in an annual series of oral and written Questions which they will not be able to evade. I say "may have to be extracted", because the Committee will understand that I am in no position to predict what will happen in the future. I certainly have no part in tactical decisions. I can only express what is a personal opinion as to what conceivably might happen.

I do not know whether the Minister had it in mind to agree to these amendments all along. If not, and if he wants time to consider the theoretical consequences that I have suggested might--I stress "might"--follow, I would be willing to afford time for consultation and bring back an agreed amendment or amendments at another stage. I beg to move.

Lord Razzall: Before the Minister responds, perhaps I may intervene. As he is aware, we on these Benches

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stand four square behind the Government in their determination to ensure that the National Minimum Wage Bill goes through. However, as he well knows, there is an area on which agreement has not been reached with the Government; namely, the area which the noble Baroness has touched on. I and my colleagues have pressed the Minister on a number of occasions and each time he has avoided answering us, with incredible legal and political felicity. As a result of the events of last week we realise why his forensic skills in this area have been put to the test so much.

However, I would like to take the opportunity to press the Minister again. It is important that the report from the Low Pay Commission is permanently enshrined in our legislative and statutory structure. It is important not only for the reason which the noble Baroness gave as regards full disclosure to the public--we share that view--but, more particularly, because of the fear I expressed last week in response to the Statement. Unless the Low Pay Commission is given permanent status and clear criteria are set out in the Bill as to the form of the report we can expect regularly, then every year we shall have the kind of undignified political football passing that we witnessed last week in the Government's response to the initial report of the commission. Therefore that is why I ask the noble Lord the Minister again to confirm that the Government will give permanent status to the Low Pay Commission and will bring forward amendments at Report stage to make sure that happens.

Lord Falconer of Thoroton: If I may, I will speak to Amendment No. 125 at the same time as I speak to Amendment No. 124. Amendment No. 125 is the one which encapsulates what the noble Baroness is after, but that amendment--

Lord Razzall: I was of course referring in my remarks to the forensic skills of the noble Lord, Lord Clinton-Davis.

Lord Falconer of Thoroton: I assumed that was the position! Amendment No. 125 would require in its first subsection that the Secretary of State and the Chancellor of the Exchequer would together report to Parliament annually on the operation of the national minimum wage. The amendment proposes that they would need to take account of a host of factors: the economy and competitiveness, regional factors, comparative pay, unemployment and benefit levels, training and labour markets, small business, the disabled and age variations.

These are all factors which the Low Pay Commission has looked at in coming to its recommendations and the obligation in the new clause for Ministers to report annually on them would in effect create a permanent monitoring duty in the Bill. The Government have no argument with the need for monitoring. It is clearly important to monitor the effects of any new legislation, especially in an area as important as the minimum wage, when a country has never before had a universal statutory minimum.

As with all government policies, we will wish to evaluate the effect of producing a minimum wage in full, which is likely to include most, if not all areas listed

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in the proposed new clause in the amendment put forward by the noble Baroness. The amendment--this is strongly supported by the noble Lord, Lord Razzall--also sees a permanent role for the Low Pay Commission in continuing to monitor the impact of the minimum wage. The Government have made clear in publishing the report of the Low Pay Commission that they wish the commission to continue to monitor and research the impact of the minimum wage following its introduction.

The criteria listed by the new clause in the amendment look sensible enough, though perhaps not exhaustive. Doubtless, given time, we could all come up with more which could be added. That points to one of the reasons why I ask the Committee to oppose this amendment, if it is pressed, because it is unnecessary and over-rigid to prescribe in primary legislation who should monitor and report on the impact of the legislation, how they should do that and when.

Furthermore, however important the matters involved may be, it is important to recognise that producing such a report would be an extremely time-consuming exercise and its content could also overlap with other government documents, notably the competitiveness White Paper and possibly, to some extent, Budget documentation. It is therefore preferable to leave this matter open. An annual report from the Secretary of State and the Chancellor specifically on the national minimum wage could easily become seen as part of the annual pay round and lead to expectations of annual increases.

Turning now to the role of the Low Pay Commission, which was specifically referred to by the noble Lord, Lord Razzall, the amendment--and this is supported by the noble Lord--impliedly presumes that the Low Pay Commission will be a permanent body with the power to initiate its own work and make reports, rather than having to wait for matters to be referred to it by the Secretary of State.

I should start by making it quite clear that the Government fully appreciate the value of the work that the commission has carried out in making its report. I have also already indicated that the Government wish the commission to continue to monitor and report on the impact of the minimum wage following its introduction. The position envisaged by the amendment goes somewhat beyond what the commission was asked to do for its first report. The commission envisaged by this amendment would have the power, it appears, to report on anything it wanted at its own initiative, including a whole range of matters raised and debated previously both in this Chamber and another place at various times during the passage of this Bill. I can imagine that life as a commissioner in such a body would be incredible fun. It would be a job for a very long period indeed and there would be the opportunity to indulge in any particular matter of interest--and all, of course, at the public expense.

I find it strange that the noble Baroness should support such a powerful and unaccountable body. This runs counter to other amendments she has put forward which seek to constrain and limit the Low Pay Commission's powers. Your Lordships should have no fear. The Government envisage the commission as task

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orientated, and not unlimited. It is right that Ministers, as elected representatives accountable to Parliament, should be responsible for the setting of those tasks, and one of those tasks is that of monitoring, as I have indicated.

It is in order to maintain the task-orientated focus that the commission must be essentially reactive and not proactive. The commission must, of course, be independent in reaching its views, but the commission's ongoing activity should be within the framework set by politicians. There are good administrative and accountability reasons for this arrangement. I believe that the proposed amendment, together with the views expressed by the noble Lord, Lord Razzall, would go beyond what the Government believe is a common-sense structure for the commission's activities and in relation to reporting to Parliament. I therefore ask the Committee to reject the amendment, if it is pressed.

6.45 p.m.

Lord Fraser of Carmyllie: Before my noble friend determines whether or not to withdraw her amendment, can I say to the noble and learned Lord that I thought he glided through that answer extremely skilfully. There is one point, however, on which I should like a little further clarification. There has been some political speculation, doubtless false, in the media to the effect that the Prime Minister is not wholly enamoured of the idea of the permanent existence of this Low Pay Commission. While he certainly indicated in his answer that the Government thought it desirable that there should be a permanent evaluation of what is going on, I am not sure that I actually heard him say that indefinitely and on a permanent basis the Low Pay Commission is to be the body which will do that. I may have misunderstood the position, but if the noble and learned Lord is in a position to say that the Low Pay Commission is to be a body of permanent establishment, it would certainly help to clarify the doubtless wholly unjustified speculation there has been in the media.